Over 75 million workers face retirement without pensions
More than 75 million informal workers in Nigeria are likely to face retirement without access to structured pension benefits unless urgent reforms and expanded coverage are implemented, the Director-General of the National Pension Commission (PenCom) has warned. Speaking at a major conference in Abuja, the PenCom DG said that although millions of Nigerians are part of the informal economy, most of them currently have no viable path to retirement security through the existing contributory pension system. 
The informal sector — which includes traders, artisans, farmers, hairdressers, mechanics, gig-economy workers and freelance professionals — accounts for an estimated 70 million to 80 million Nigerians who earn their living outside formal employment. That cohort greatly exceeds the number of informal workers currently registered under pension plans, creating a retirement gap of historic proportions. 
According to figures released by PenCom and confirmed by independent pension analysts, only about 215,000 informal sector contributors are currently enrolled in pension schemes, leaving a vast majority of Nigeria’s workforce excluded from pension coverage and retirement security. If nothing changes, the majority of these informal workers could slide into old age without any pension benefits at all. 
The Informal Sector Pension Gap in Context
Nigeria’s informal sector is a powerhouse of the economy. Workers outside formal employment carry out trade and services that sustain local markets and drive regional commerce. Yet, because most pension frameworks traditionally focus on salaried employees with regular earnings, the informal workforce has largely been left out of formal retirement systems.
PenCom’s Director-General, Ms. Omolola Oloworaran, emphasised that this exclusion means that millions of informal workers face an uncertain and insecure future once they reach retirement age. She said expanding pension coverage is not only a matter of social justice but also essential for national economic stability. 
“If we do not urgently address the gap in pension coverage for informal workers, millions of Nigerians will reach retirement age with no savings, no safety net and no dignity in old age,” she told delegates at the annual pension conference. Her remarks highlighted the fact that over 75 million informal workers face retirement without pensions unless comprehensive reforms are implemented. 
https://ogelenews.ng/over-75-million-workers-face-retirement-without-pen…
Why the Gap Exists
Under the current Contributory Pension Scheme (CPS) — established by the Pension Reform Act — formal sector employees and their employers contribute regular monthly amounts into Retirement Savings Accounts (RSAs) managed by licensed pension fund administrators. However, workers in the informal sector, who are often self-employed or contract-based, lack formal structures that require routine contributions, leaving many unregistered and therefore without a pension lifecycle plan. 
PenCom has sought to address this imbalance through the launch of personal and micro-pension plans designed to cater to the self-employed and informal workforce. These plans allow flexible contributions that suit irregular incomes, aiming to make pensions accessible to individuals whose earnings do not fit traditional payroll patterns. But the take-up has remained limited, with only a tiny fraction of the informal workforce signing up so far. 
“The challenge is not only about creating pension products,” Ms. Oloworaran said. “It’s also about building trust, educating potential contributors, and creating frameworks that reflect the economic realities of informal workers.” 
PenCom’s Strategy to Close the Retirement Gap
To confront the looming pension gap, PenCom has revamped its approach to market the Personal Pension Plan (PPP), which replaced the earlier micro-pension scheme. The new plan offers greater flexibility, multiple contribution channels (including mobile and digital payment platforms), and provisions that allow contributors to access part of their savings for emergencies while still building retirement assets. 
Under the revised design, informal workers — including artisans, traders, and small-scale farmers — can enrol from as young as 18 years old, contribute at their convenience, and split their savings between emergency funds and long-term retirement accounts. PenCom hopes that such features will incentivise broader participation among informal workers, whose incomes often fluctuate and do not conform to formal employment payroll systems. 
PenCom’s strategy also includes expanded public awareness campaigns, partnerships with local associations and trade unions, and simplified onboarding processes designed to reduce barriers to entry for informal workers. These initiatives are aimed at ensuring that Nigeria’s pension system becomes more inclusive, equitable, and resilient. 
The Human and Economic Cost of No Pensions
For millions of Nigerians, the prospect of retirement without a pension is more than a statistic — it is a potential reality that carries profound human and economic implications. Informal workers who have spent decades contributing to household incomes and community economies could, in retirement, be left without the financial support necessary to cover healthcare, housing or basic living expenses. This can contribute to increased poverty among the elderly and greater reliance on family networks that themselves are under economic strain.
Social welfare advocates argue that the pension gap also poses a broader economic threat. Without pension income, retirees may not have funds to participate in consumer markets, potentially reducing household spending and weakening economic demand. A pension system that covers a wider base of workers can foster economic stability and encourage lifelong saving habits that benefit overall financial health. 
Over 75 million workers face retirement without pensions.
Calls for Policy and Institutional Support
Experts say that closing the retirement coverage gap requires more than flexible pension products; it demands collaboration between government, financial institutions, civil society and community leaders. Policy adjustments that encourage or require automatic enrolment, tax incentives for pension saving, and stronger regulatory frameworks could help draw millions more informal workers into the system.
Critics note that while flexible pension plans are a step forward, success will depend on sustained engagement at the grassroots level. Many informal workers lack formal identification, banking access, or awareness of how pension systems operate — barriers that must be addressed to ensure meaningful inclusion. 
Why This Matters for Nigeria’s Future
Nigeria’s demographic trends — including a growing working-age population — mean that adequate retirement provision is not just a social concern but a long-term economic priority. If over 75 million informal workers face retirement without pensions, the country could see a rise in elderly poverty, weakened consumer markets and greater pressure on limited social safety nets.
PenCom’s DG stresses that extending pension coverage is not merely an economic policy choice but a moral imperative that affirms the dignity of work — whether in the formal or informal economy. Ensuring that every Nigerian can look forward to a secure retirement, she argues, should be seen as a shared national goal. 
https://punchng.com/pencom-targets-80m-informal-workers-with-micro-pension-plan
Over 75 million workers face retirement without pensions
